Every investor in Kunming Chuan Jin Nuo Chemical Co., Ltd. (SZSE:300505) should be aware of the most powerful shareholder groups. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don't tell me what you think, tell me what you have in your portfolio.
Kunming Chuan Jin Nuo Chemical isn't enormous, but it's not particularly small either. It has a market capitalization of CN¥6.0b, which means it would generally expect to see some institutions on the share registry. In the chart below, we can see that institutions own shares in the company. Let's delve deeper into each type of owner, to discover more about Kunming Chuan Jin Nuo Chemical.
View our latest analysis for Kunming Chuan Jin Nuo ChemicalSZSE:300505 Ownership Breakdown June 9th 2022
What Does The Institutional Ownership Tell Us About Kunming Chuan Jin Nuo Chemical?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
Kunming Chuan Jin Nuo Chemical already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Kunming Chuan Jin Nuo Chemical's historic earnings and revenue below, but keep in mind there's always more to the story.SZSE:300505 Earnings and Revenue Growth June 9th 2022
We note that hedge funds don't have a meaningful investment in Kunming Chuan Jin Nuo Chemical. Meng Liu is currently the company's largest shareholder with 32% of shares outstanding. Caitong Fund Management Co., Ltd. is the second largest shareholder owning 4.0% of common stock, and Shanghai Jihao Asset Management Co., Ltd. holds about 2.3% of the company stock. In addition, we found that Jia Gui Wei, the CEO has 1.9% of the shares allocated to their name.
A closer look at our ownership figures suggests that the top 12 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Kunming Chuan Jin Nuo Chemical
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
It seems insiders own a significant proportion of Kunming Chuan Jin Nuo Chemical Co., Ltd.. Insiders have a CN¥2.4b stake in this CN¥6.0b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 46% stake in Kunming Chuan Jin Nuo Chemical. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For example, we've discovered 3 warning signs for Kunming Chuan Jin Nuo Chemical (1 is significant!) that you should be aware of before investing here.
Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.